Value of land for highway disputed

Development potential puts worth far higher, property owners say

Sep. 17, 2013

Tom Walsh

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The state Department of Transportation has badly undervalued land taken for the reconstruction of the Interstate 90 interchange at Cliff Avenue, two Sioux Falls businessmen contend.

In the DOT’s petition to condemn the properties filed last year, the DOT determined just compensation to be $20,100 on one of the properties. The property owners, Tom Walsh and Robert Miller, want more than $500,000.

The new interchange will permanently close the intersection of 63rd Street North and Cliff Avenue. The land owned by Walsh and Miller is on 63rd Street North, and they say the road work will make the property much less valuable.

“We have a right to reasonable access to the transportation system,” said their lawyer, Mark Meierhenry. “The highest and best use is gone.”

With a jury trial scheduled for January, the parties met for a motions hearing Monday in Minnehaha County Circuit Court. The DOT’s lawyer, Karla Engle, had asked a judge to rule in the state’s favor without going to trial.

“The bottom line is that the department is closing that intersection,” Engle said.

Meierhenry moved that the property owners be allowed to present their own appraisal in an effort to determine what the land would have been worth if it had been commercially developed. The 2008 plan for the property was a Kelly Inn motel. That and similar commercial development now will be impractical, according to the owners, who say they should be compensated for the loss of value.

“We’re the defendants in this case; the state has taken property,” Meierhenry said.

The property’s owners needed to show a “peculiar” injury for the potential value of the property to be considered for compensation, Engle argued.

“He has to show that his injury is greater than that which the public suffers,” she said. “I don’t think he’s done it.”

Another set of defendants, John Duncan and Dakotah Bank, were added to the case at the beginning of the hearing.

Circuit Judge Susan Sabers declined to rule on either motion Monday. Instead, she told both lawyers they would receive the ruling sometime in the next two weeks once she’s had time to review arguments.